FDI in retail: Are there any takers?

FDI in retail: Are there any takers?

India Inc on Monday appeared to be divided on allowing foreign direct investment in multi-brand retail, an issue which has rocked Parliament and drawn stiff opposition from United Progressive Alliance ally Trinamool Congress.

While Federation of Indian Chambers of Commerce and Industry extended an all-out support to the government, Confederation of Indian Industry recommended 'a calibrated approach for introducing FDI in the retail sector in terms of the percentage and minimum capitalisation requirements'.

FDI in retail: Are there any takers?

Addressing a press conference, Ficci secretary general Rajiv Kumar said opening of the retail sector would create big employment opportunities in the country.

Without naming, he said those industry associations which are opposing the foreign direct investment in multi-brand retail have a vested interest.

"This is just a fear that has been created for some vested interest. FDI in retail will be a game-changer like telecom. I see only positive impact on employment," he said.

CII, on the other hand, said while it 'strongly supports the introduction of FDI in multi-brand retail trading, it recommends a calibrated approach for introducing FDI in the retail sector in terms of the percentage and minimum capitalisation requirements'.

FDI in retail: Are there any takers?

Terming as 'dangerous' the Centre's move to allow foreign direct investment in retail trade, UPA ally DMK on Monday demanded the decision be withdrawn forthwith, said another report from Chennai.

Dravida Munnetra Kazhagam chief M Karunanidhi said, "The Centre's insistence that states should go by the decision cannot be justified.

"DMK had opposed FDI in retail trade even when the idea was originally mooted".

DMK, which has 18 members in the Lok Sabha, is the second UPA constituent to oppose the move, the first being the Mamata Banerjee-led Trinamool Congress, which also have the same number in the Lok Sabha.

FDI in retail: Are there any takers?

Taking a dig at his arch rival and Tamil Nadu Chief Minister J Jayalalithaa, who had alleged that the Centre had adopted an arrogant approach without consulting the state on the issue, Karunanidhi said the Centre's announcement could not be compared with her decision to 'steeply hike' milk price and bus fares.

The Centre should neither compel the states nor even suggest to them to implement the decision, he said, adding the Centre should withdraw the decision accepting the views of DMK and other political parties and also the unanimous demand of small traders.

This is for the second time in as many days the DMK had come out against the Centre, the first one being to oppose the Indian Coast Guard's proposal to create a no-fishing zone in Palk Straits to avoid attack on Indian Fishermen.

"In our considered view, this policy is ill advised and highly regressive. I would, therefore, earnestly request you to reconsider the matter and withdraw this policy immediately," Patnaik said in a letter to the prime minister.

"I am deeply distressed to hear about the Union Cabinet's approval for allowing 51 per cent foreign direct investment in the retail sector," he said, observing that the biggest challenge facing the country was persistent double digit inflation.

Claiming that the move would only favour large multi-national corporations which would have monopoly over trading in the country, Patnaik said the Centre should have instead strengthened marketing opportunities for farmers and small-scale manufacturers.

The Centre should have done this through appropriate supply side interventions including stepping up investment in rural infrastructure and research and development for augmenting farm productivity, he said.

FDI in retail: Are there any takers?

Left parties, demanding rollback of the move to allow FDI in retail, on Monday accused the government of deliberately taking a decision to 'derail' debates in Parliament on major issues like price rise, corruption and Lokpal.

"There is no point in having a debate on FDI in retail when a decision has already been taken. So, the government should rescind the decision and then hold a discussion on it.

"If it does not, then it is clear that the government does not want Parliament to function when there are important issues like price rise, corruption and the Lokpal Bill to be debated," senior Communist Party of India-Marxist leader Sitaram Yechury told reporters

at a joint press conference with his counterparts from Communist Party of India, RSP and Forward Bloc.

Maintaining that an executive decision on a 'major policy matter' like FDI in the retail sector has never been taken in the past when Parliament was in session, he said, "They have not only bypassed Parliament, but it is a big provocation to make Parliament impotent."